The Government of Ghana has planned to increase its borrowing through the issuance of fresh bonds in the fourth and final quarter (Q4) of the year to help meet its financing requirements.

In its Issuance Calendar for the period between October and December this year, the Finance Ministry indicated that Government aims to raise GH¢1.04 billion through the issuance of fresh instruments.

“Government plans to issue a gross amount of GHȼ21,170.00 million, of which GHȼ20,129.30 million is to rollover maturities. The remaining GH¢1,040.70 million is fresh issuance to meet Government’s financing requirements”.
Ministry of Finance

The recent planned fresh bond issuance is higher than the GH¢611.94 million issued between July and September (Q3) this year but lower than the GH¢2 billion fresh funds borrowed between June and August 2021.

Targets for the various bills

The government plans to raise GH¢10,800.00 million through the 91-day bills and GH¢1,970.00 million via the 182-day securities. A total of GH¢1,600.00 million is expected to be raised through the 362-day bills within the three months’ period.

Within this period, the government also plans to borrow GH¢750.00 million, GH¢2,300.00 million, and GH¢1,800.00 million using the 2-year, 3-year and 6-year bonds respectively. Moreover, the government intends to raise GH¢750.00 million and GH¢1,200.00 million using the 7-year and 10-year bonds correspondingly.

Detailing how its intends to issue the securities, the Finance Ministry highlighted that it will roll out the 91-day and 182-day bills on a weekly basis. The Ministry of Finance further stated that the 364-day bills will be issued bi-weekly through the primary auction with settlement being the transaction date plus one working day.

Securities of 2-year up to 10-year will be issued through the book-building method. Consistent with the MTDS, Government may announce tap-ins/reopening of other existing instruments depending on market conditions, the Finance Ministry stated.

Developing the calendar for the period

According to the Finance Ministry, the Calendar is developed based on the revised Net Domestic Financing provided in the 2021 Mid-Year Budget, the 2021 domestic maturities, the 2021 Annual Borrowing & Recovery Plan and the 2021-2024 Medium-Term Debt Management Strategy.

“It indicates the securities that are intended to be issued in respect of Government’s Public Sector Borrowing Requirements for the period October to December 2021”.
Ministry of Finance

In addition, the Calendar also takes into consideration Government’s liability management program, market developments (both domestic and international) and the Treasury & Debt Management objective of lengthening the maturity profile of the public debt.

Therefore, the Ministry of Finance indicated that the figures provided are based on its debt management strategies and current market conditions. The government, through the Finance Ministry, cautioned that the amounts stated in the Calendar are indicative, to guide the market and may be revised when transaction adverts are published. Government intends to update the Issuance Calendar on a monthly rolling basis, to reflect a full quarter financing program.

Government expressed optimism that this October to December 2021 Calendar will meet the requirements of market participants. Government further assured all stakeholders and the public that it continues to strive for greater predictability and transparency in the domestic bond market.